Last year, Japanese start-up Tonchidot Corp. stole the show at a technology conference in San Francisco where 50 young companies across various industries demonstrated their wares.
- Tonchidot
- A screenshot of Tonchidot’s Sekai Camera application, which allows people to point their phone’s camera at an object and instantly receive information about that object from other users.
Tonchidot Chief Executive Takahito Iguchi, facing tough questions from a savvy audience about his company’s “augmented reality” technology, gave a series of emphatic single-word answers, exhibiting a never-say-die attitude that delighted the TechCrunch 50 conference crowd.
After claiming that Tonchidot would never be sold to a larger tech company – and briefly pumping his fist in the air – Iguchi ended a flamboyant presentation by shouting, “Join us!” The video of that presentation has been watched hundreds of thousands of times on YouTube, and the company spurred lively debate for weeks in the tech blogosphere.
Moving beyond that buzz, Tokyo-based Tonchidot said today it raised a first institutional round of $4 million from venture firm DCM and its seed investor Itochu Technology Ventures. Osuke Honda, a DCM principal who takes a board seat at Tonchidot following the funding, said some 300,000 Japanese consumers have gravitated to the company’s social geo-tagging platform.
“In four days, Tonchidot got 100,000 users,” Honda said, referring to the launch of the company’s mobile-phone application, Sekai Camera, in September.
But questions have persisted about how this product will actually work - in particular, where all of the geo-tagged content will come from.
After opening the Sekai Camera application on a mobile phone, a user points his phone camera at a building, street or other object, and instantly gets a stream of information about sales, promotions, events and amenities in that area. The information overlays the image that appears on the camera phone.
The company’s CEO said the information will come from users, a statement that was greeted with skepticism at TechCrunch50.
But Honda, the DCM investor who led the company’s first round, said that users in Japan – the only place where the Sekai Camera has been released – have not only provided massive amounts of content for the camera, but have begun to use the platform for other social activities.
“This was the number one iPhone app in Japan for a while,” he said. “It’s not just a technology play for us. It’s also a content-creation play, a marketing play and a social play. And the company that gets the balance of those things right will be the winner.”
Tonchidot will make its first major play in the U.S. with an iPhone app, slated to be released in the next few weeks, Honda said.
While the Sekai Camera is available for free, the company is contemplating using advertising to monetize the business, or to hammer out revenue-sharing deals with social networks and gaming companies, according to Honda.
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COMMENTARY:� I have posted a few articles about the emerging technology known as position-based marketing that uses mobile devices like cellphones to track your location�anywhere on the planet, 24/7, 365, then bombard you with commercial�messages from�businesses located in the�area where you just happen to be at the time.
Tonchido's�"Augmented Reality", appears to be the next generation�of position-based marketing that utilizes what Tonchido's CEO calls "geo-tagging",�relying on users to provide the content for this new form of�position-based marketing.��
The Sekai Camera app has taken position-based marketing to�a different level, but I wonder if by embracing this�new technology,�consumer's are�giving up�too much control and accessibility over�their daily lives�to�businesses hungry for their attention and wallets.� Everything seems to be going mobile, including ad dollars, so this was bound to happen sooner or later.
For this to work,�everybody has to buy into the new technology.��Consumer's will have to�"opt-in" to the new technology and�provide the content and a lot of personal information, and�businesses will have to provide the consumer with�products or services that fill a need and are relevant to that consumer.�
Advertiser's will also need to find a way to�combine or embed an ad�with that content, something akin to video�marketing.� I find this very intrusive,�and you often have to sit through�a commercial video�before you can actually view what you wanted to see.� I usually hit that SKIP button. ������
I hate shopping, so the Sekai Camera app�is not going improve my quality of life and I�hate to opt-in to anything. My email box�filters out 95% of my spam, but some still manage to get through.� I can visualize where everywhere I go the Sekai Camera app will suddenly display a "pop-up", a real inconvenience and aggressive form of intrusive marketing, something that businesses are very good at doing.
Tonchido's�CEO says, “This was the number one iPhone app in Japan for a while.�It’s not just a technology play for us. It’s also a content-creation play, a marketing play and a social play. And the company that gets the balance of those things right will be the winner.”� That's a profound statement.�Translation: How do you make money off of this�new technology?
For Tonchido's technology to gain traction, it will have to develop strategic partnerships with a lot of player's including the consumer, professional content providers, advertising networks, ad agencies and corporate America.�And what about standard's.� Will Tonchido's technology encounter ad format standard issues like those encountered in video marketing?�
Will Tonchido's technology become�the YouTube of the mobile phone, that relies on user-generated content? Many advertiser's have not gotten on board, and to this day, YouTube has not�profitabily monetized all that�user-generated content, most of which is superfulous and junk.
I have often stated that I am not so sure about the future of mobile marketing as an effective marketing medium.�There are probably a lot of people who will burn me at the stake for saying this, but forecast's for mobile advertising just doesn't impress me,�at least not�yet.�
There is already far too much intrusive marketing going on, and social networking has only intensified this form of�marketing that�stalks you no matter where you are online.� I have often joked about those Rue La La and Ideeli displays that appear on a lit of sites that I visit.�
Intrusive marketing has gone from the TV-to-online-to-mobile, and�now this new technology called "Augmented Reality"�rears it's head.� A lot of things have to click for Tonchido to�monetize Augumented Reality, and Tonchido realizes this,�which is why they are�offering the Sekai Camera app free.� Whenever somebody gives you something for free,�watch out.� Nothing really comes free.
Courtesy of an article dated December 8, 2009 appearing in The Wall Street Journal����������
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